CALGARY, ALBERTA -- (Marketwire) -- 11/20/12 -- Cobalt Coal Ltd (TSX VENTURE:CCF) ("Cobalt" or the "Corporation") advises the filing of an amended technical report (the "Amended ESI Technical Report") which evaluates the coal bearing properties located in Virginia, USA that are proposed to be acquired by Cobalt (the "KMH/C&B Acquisitions"). The KMH/C&B Acquisitions were the subject of Cobalt's February 29, 2012 and March 8, 2012 news releases. The Amended ESI Technical Report replaces the original technical report prepared in respect of the KMH/C&B Acquisitions which was the subject of Cobalt's news release dated July 17, 2012 and was filed on Sedar on that same date (the "Original ESI Technical Report"). The Amended ESI Technical Report is dated effective May 24, 2012 which is the same effective date as the Original ESI Technical Report.

Further to Cobalt's news release dated October 11, 2012, the Amended ESI Technical Report was prepared in accordance with the requirements of the Alberta Securities Commission ("ASC") as a result of the ASC's continuous disclosure review of Cobalt.

This news release summarizes the contents of the Amended ESI Technical Report and also highlights the revisions to the Original ESI Technical Report, where applicable.

Technical Report and Qualified Person

The qualified person responsible for the preparation of the Amended ESI Technical Report was Mike Clisso, PE, President of ESI, Inc. dba Engineering Services ("ESI"). The report was prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101").

The following is a summary of the Coal Resources identified in the Amended ESI Technical Report:

The quantity of Coal Resources contained in the Amended ESI Technical Report is the same as that contained in the Original ESI Technical Report. The Coal Resources estimated above are situated on six different tracts, each containing multiple seams of coal as further detailed in the "General Information" section below.

Upon having established the quantities of Coal Resources detailed above, a pre-feasibility study was then performed on 4 seams located on 2 of the 6 tracts to be acquired pursuant to the KMH/C&B Acquisitions. The economic evaluation supported that the Coal Resources contained in those seams can be classified as Proven Coal Reserves. The quality information for these 4 seams has established that they are mid-vol metallurgical coals. The quantity of Proven Coal Reserves contained in the Amended ESI Technical Report is the same as that contained in the Original ESI Technical Report and is as follows:

The Amended ESI Technical Report estimated the net present value of future net cash flows for the Proven Metallurgical Coal Reserves at different discount rates and included the required startup and sustaining capital requirements.

In contrast to the Original ESI Technical Report, the Revised ESI Technical Report reduced the annual net free cash flow, after capital expenditures, by the amount of Federal and Virginia State income taxes such that the discounted net present value of future cash flows were also presented on an "after tax" basis.

All applicable royalties and all additional Federal and State levies that were contained in the Original ESI Technical Report were retained in the economic analysis contained in the Amended ESI Technical Report which yielded the following results:

The amended ESI Technical Report determined that the base case after tax Payback period is 1.75 years and the IRR is 92%.

KMH Acquisition

The properties associated with the KMH Acquisition are located proximate to Clinchco, Virginia. Cobalt will be acquiring leases on 6 separate tracts covering approximately 5,400 acres which lie within the drainage areas of the Cranes Nest River in Dickenson County, Virginia. Numerous seams of coal which are historically mid-vol metallurgical coal have been identified to exist on the tracts including the Hagy, Splashdam, Upper Banner, Lower Banner, Raven, Jawbone, Upper Seaboard, Middle Seaboard, War Creek, Lower Horsepen, and Pocahontas No.3. One of the tracts to be acquired, the Mill Creek Tract, approximately 900 acres, is currently permitted for both surface and underground mining (the "Permit"), with a pending amendment to include an adjoining lease, approximately 700 acres, which will also be acquired by Cobalt pursuant to the C&B acquisition described below,. The Amended ESI Technical Report estimated Proven Reserves of mid-vol metallurgical coal included in the Upper and Lower Banner seams of the Davis Tract and the Hagy and Splashdam seams of the Mill Creek Tract.

C&B Acquisition

The C&B Acquisition involves lands covering approximately 700 acres that are immediately adjacent to the Mill Creek Tract being acquired pursuant to the KMH Acquisition such that the Mill Creek Tract will expand in size from approximately 900 acres to approximately 1,600 acres and is the subject of the Permit extension described above. Proven Reserves of mid vol metallurgical coal were established in two seams on this Tract, being the Hagy and Splashdam seams.

General Information

The following information is extracted from the Amended ESI Technical Report which is NI 43-101 compliant. A full text version of the ESI Technical Report has been filed on SEDAR and is available at www.sedar.com.

ESI used the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Definition Standards on Mineral Resources and Reserves ("CIM Definitions") adopted by the CIM Council on December 11, 2005 during the classification, estimation and reporting of mineral resources and reserves for the KMH Acquisition and the C&B Acquisition.

ESI conducted physical inspections of all 6 Tracts including the Mill Creek Tract and the Davis Tract for which the Amended ESI Technical Report has assigned Proven Reserves. ESI has also examined the environmental conditions of the Permit and has determined that all applicable environmental regulations have been complied with such that the Permit is in substantial compliance with applicable regulations. In addition, the Amended ESI Technical Report contains a study of the other tracts associated with the KMH Acquisition and C&B Acquisition presented accordance with the provisions of NI 43-101.

Basis of Presentation

The majority of the data reviewed to establish seam thickness and elevation has been obtained from historical mining operations on currently abandoned underground and surface mines. For the Mill Creek and Davis Tracts, a total of 110 data points have been analyzed for purposes of estimating seam thickness and seam elevation. In addition to previous mining records, surface outcrop data has been reviewed. Additionally, drilling and core data has been used to augment geological and mining data that is available from previous mining records or surface outcrop information. Information from a total of 38 drill holes was reviewed during the evaluation.

Coal samples were taken and analyzed yielding the following quality data for the Mill Creek and Davis tracts:

-- The dry basis clean coal Ash is less than 6.0 wt%;
-- The Ash Fusion Temperature is high;
-- The Free Swelling Index is consistently 7 or above; and
-- The volatile matter (VM cc DB) ranges from 27 wt% to 31%.

This coal quality data supports the conclusion that the Proven Reserves reported in the Amended ESI Technical Report may be classified as metallurgical in nature.

ESI is of the opinion that the spacing of available coal quality data for the Hagy and Splashdam on the Mill Creek Tract are adequate to support the metallurgical quality determination. The Upper Banner and Lower Banner on the Davis Tract also meet the necessary criteria to support the quality as being metallurgical in nature.

Coal Reserves

In accordance with CIM Definitions and the policies of NI 43-101, a "Reserve" is defined as the economically mineable portion of a "Measured" or "Indicated Resource" that has been demonstrated, after a thorough analysis of mining, processing, economic and other relevant factors, to be economically justified for coal extraction at the time of reporting. Coal Reserves are sub-divided in order of increasing confidence into 'Probable' and 'Proven' Reserves, respectively. A "Probable" Coal Reserve is defined as the economically mineable part of an "Indicated' Resource", and in some cases of a "Measured Resource". A "Proven" Coal Reserve is defined as the economically mineable part of a "Measured Resource".

Two of the 6 tracts are of interest for immediate development, being the Mill Creek Tract and the Davis Tract. Each of these 2 tracts contains numerous coal seams that contain substantial coal resources. These seams have well known extent, quality and mining conditions and have been historically proven to be high quality metallurgical coals. Only the coal resources in the Hagy and Splashdam seams on the Mill Creek Tract and the Upper Banner and Lower Banner seams on the Davis Tract have been economically evaluated in the Amended ESI Technical Report. The economic analysis supports the classification of these resources as Proven Reserves. The coal shown to exist in the balance of the seams has remained classified as Coal Resources.

The Federal Mine Safety and Health Administration ("MSHA") regulations provide for mining to a 50' barrier against old mine workings as long as the specified mining practice is followed. This is applicable for only the Upper Banner seam on the Davis Tract and a small area in the Splashdam seam on the Mill Creek Tract as old mine workings are known to exist in these seams. It is not applicable in the case of the Hagy seam or in the southern section of the Splashdam and Lower Banner seams on the Mill Creek and Davis Tracts insofar as no other old mine workings are known to exist within those seams on those Tracts. According to the Amended ESI Technical Report, Proven Reserves quantities have been calculated based on compliance with these regulations regarding setback. The following table summarizes the Proven Reserves contained in the Hagy and Splashdam seams on the Mill Creek and on the Upper and Lower Banner seams on the Davis Tracts. The quantity of Proven Reserves in the Amended ESI Technical Report is the same as in the Original ESI Technical Report. Proven Reserves are estimated to total 15,874,000 tons allocated as follows:

The coal seams on the Mill Creek Tract and the Davis Tract are flat lying to very gently dipping and are generally unfaulted. These characteristics indicate that these seams should be classified as "Low Type A" Geology Type to reflect the minimal geological complexity in accordance with GSC Paper 88-21. These Tracts contain underground mineable deposits. The remaining seams (other than the Hagy and Splashdam seams on the Mill Creek Tract and the Upper Banner and Lower Banner seams on the Davis Tract) were not economically evaluated in the Amended ESI Technical Report; however, according to the Amended ESI Technical Report, they contain significant quantities of Coal Resources that have been estimated by the methodology of GSC Paper 88-21 as discussed below.

Coal Resources

In addition to the Coal Reserves described above, the Amended ESI Technical Report identifies the existence of Coal Resources on the Mill Creek, Davis, Tarpon, Fleming and Stanley Tracts. These tracts contain numerous seams with well-known extent, quality and mining conditions which have been historically proven to be high quality metallurgical coals. Volumes were estimated in accordance with the methodology of GSC Paper 88-21. The Coal Resource volumes in the Amended ESI Technical Report are the same as contained in the Original ESI Technical Report.

The following table summarizes the in-place Coal Resources present in the various seams on the Mill Creek, Davis, Tarpon, Fleming and Stanley Tracts and includes the volumes on the Mill Creek and Davis Tracts that were classified as Proven Reserves. It should be noted that they were included insofar as the practices of GSC 88-21 specify that resources be reported inclusive of reserves, based on the premise that such reserves are simply a special class of resources.

For purposes of evaluating the economic viability of the project, the Amended ESI Technical Report used the standards of CIM and the policies of NI 43-101. They provide that a Coal Reserve is the economically mineable portion of a Measured or Indicated Coal Resource that has been demonstrated, after a thorough analysis of mining, processing, economic and other relevant factors, to be economically justified for coal extraction at the time of reporting.

In accordance with CIM and NI 43-101 policies, estimates of initial startup capital requirements and sustaining capital costs were included in the Amended ESI Technical Report for total mine life. Estimated capital costs are broken down into "Initial Mine Setup Costs" ($1,200,000) and "Equipment Costs" ($11,000,000) which, in each case, are the cost of "facing up" and "acquiring the equipment needed", respectively, to place each seam into production.

For the purposes of the Amended ESI Technical Report:

(a) Operating costs were segregated into "support costs", "labor costs" and "supply costs" which are dependent on coal seam thickness. These costs range from $64.25 per ton to $94.26 per ton;

(b) The net coal sales price used ranged from $133 to $135 per ton of clean coal delivered to the wash plant which is based on a previous purchase order and confirmation by pricing forecasts compiled by Deutsche Bank of eleven investment institutions and the Goldman Sachs 2012 metallurgical coal price forecast, Unlike the Original ESI Technical Report which held the coal price constant at $130 per ton, the Amended ESI Technical Report involved a more comprehensive pricing study and also took into account the trucking costs from various seams to either of two separate washing facilities in the nearby area such that net sales price achieved varies between $133 and $135 per ton depending on the tract and which of those two nearest wash facilities that production was trucked to. As a result of these factors, the before tax discounted NPV's arrived at in the Amended ESI Technical Report increased slightly from those arrived at in the Original ESI Technical Report.

(c) The mine life was established by preparing a detailed mine plan for all of the seams evaluated;

(d) The optimum mine plan yielded overall recoveries of 60% of the in-place metallurgical Coal Reserves over the life of the mine;

(e) The optimum mine plan involves a "room and pillar" scheme;

(f) Retreat mining that would recover the balance of the metallurgical Coal Reserves was not evaluated for purposes of this report;

(g) The evaluation contained in the Original ESI Technical Report was completed only on a "Before Federal and State Corporate Income Tax Basis". The Amended ESI Technical Report also reports the "After Federal and State Corporate Tax" results. Each report contained the same royalty burdens,, wheelage charges and additional state and federal levies.

(h) Property acquisition costs are not included in this analysis.

Proposed Commencement and Mining Schedule

The projected mining schedule contained in the Original ESI Technical Report and in the Amended ESI Technical Report are the same. Each projected mining to commence in the Hagy Seam (Mill Creek Tract) with one continuous miner. Subject to the availability of financing, the Amended ESI Technical Report assumed that a second continuous miner will be added 4 months later. Production volumes in the Amended ESI Technical Report were estimated to begin at 5,500 clean tons for the first month of production increasing to 9,400 clean tons for the second month and increasing to 16,934 clean tons for the remaining months and annualized production was estimated at 203,212 clean tons per year per section from this first seam.

Mining of the Splashdam seam (Mill Creek Tract) is forecast to begin in January 2013 with the same ramp up schedule utilized as for the Hagy seam. Two continuous miners are included on each of the Hagy and Splashdam seams per mine producing coal with the Splashdam seam production at 163,868 clean tons per year per section.

Production from the Lower Banner seam (Davis Tract) is forecast to begin in 2014 with a second continuous miner added in 2015. The production in the Lower Banner seam is estimated at 214,594 clean tons per year per section.

Production from the Upper Banner seam (Davis Tract) is forecast to begin during January 2014 and continue for 14 years. Production is estimated at 96,000 clean tons per year with one conventional section of equipment.

Forecast production rates in the Original ESI Technical Report for each of the first 7 years (in tons per year) from the Proven Reserves in the Hagy, Splashdam, Lower Banner and Upper Banner seams on the Mill Creek Tract and the Davis Tract is therefore as follows:

It should be noted that there can be no assurance that the production volumes or operating cost projections contained in the Amended ESI Technical Report will be met by Cobalt as many factors, many of which are beyond the control of Cobalt, will affect Cobalt's ability to achieve them including, but not limited to, the availability of financing to acquire the necessary equipment and the markets generally with respect to prices received for metallurgical coal. As Cobalt has not yet closed the KMH/C&B Acquisition the projected production schedule contained in the Amended ESI Technical Report will be delayed.

Recommendations of the Amended ESI Technical Report

The Amended ESI Technical Report makes the following recommendations:

(a) That Cobalt undertakes a program of exploration and confirmation drilling on each of the tracts combined with surface outcrop sampling and measuring. The collection of this additional data will support improved resources mapping confidence and will in turn yield additional quantities of Measured and Indicated Coal Resources by transitioning the large quantity of Inferred Resources to one of those more confident Measured or Indicated categories;

(b) That Cobalt expands the scope of the report to economically evaluate many of the other seams on the tracts to be acquired. Many of the seams situated on the tracts have been economically mined in the past on lands in the immediate vicinity of, and surrounding, the tracts to be acquired. In the opinion of the author of the Amended ESI Technical Report, significant additional volumes of Proven and Probable Coal Reserves would be confirmed by identifying a preferred mining method for, and performing an economic analysis on, many of those seams; and

(c) The Amended ESI Technical Report emphasizes the need for Cobalt to investigate the construction of, or acquisition of, a suitable wash plant insofar as prices realized for production can be significantly increased thereby.

About Cobalt

Cobalt is a publicly traded coal exploration and production company headquartered in Calgary, Alberta, Canada with a regional office in Welch, West Virginia USA. Cobalt was created to capitalize on the growth opportunities that exist in the metallurgical coal mining industry.

READER ADVISORY

Statements in this News Release may constitute "forward-looking" statements and "forward-looking" information (collectively, "forward-looking statements") as defined in applicable securities laws, which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements may include, but are not limited to, statements regarding:

-- future extraction and exploitation of mineral deposits;
-- the quality of mineral deposits;
-- capital expenditure requirements;
-- expectations regarding prices and costs;
-- development of mineral resources and mineral extraction processes;
-- the Corporation spending the funds available to it as stated in this
News Release;
-- expectations regarding the Corporation's ability to subsequently raise
capital;
-- expenditures to be made by the Corporation to meet certain work
commitments;
-- work plans to be conducted by the Corporation; and
-- reclamation and rehabilitation obligations and liabilities.

In certain cases, forward-looking statements can be identified by the use of such words as "may", "would", "could", "will", "intend", "expect", "believe", "plan", "anticipate", "estimate", "should", "provide" and other similar terminology. These statements reflect the Corporation's current expectations regarding future events and operating performance and speak only as of the date of this News Release. Forward-looking statements are not a guarantee of future performance and involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements.

Such forward-looking statements are based on a number of material factors and assumptions, including, that:

-- the Corporation executes its project development plans in a manner
consistent with its budgets and planning;
-- studies to support the Corporation's current development plans; and
-- the Corporation obtains additional financing in the future.

Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. Although the forward-looking statements contained in this News Release are based upon what management of the Corporation believes are reasonable assumptions, the Corporation cannot assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this News Release and are expressly qualified in their entirety by this cautionary statement. Subject to applicable securities laws, the Corporation assumes no obligation to update or revise them to reflect new events or circumstances.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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